The Sorrowful Lament of Loudribs Recession

Hello Lemmings. Ok, so after a brief foray into the world of madmen of yore I’m afraid it’s back to the tiresome business of griping about the present. Despite the target rich environment that abounds right now, I’m going to try and keep this focused by venting some bile on a topic that’s very close to my heart….The Great Economic Apocalypse Fuckery Of 2008/9. I’m very attached to this event in a deeply emotional way as I’m a doom monger by disposition and the boom years didn’t sit well with me. This is partly down to me being a perennial underachiever. Despite fast approaching 30, being academically well qualified and having worked many ‘responsible’/‘worthy’ jobs, I still earn below the national average wage, ride the bus and rent my dwelling. I’m also highly phobic about debt and not really one to go for in extravagant materialism which seemed to put me at odds with the rest of the world during the good times. In fact, the years 2003 to 2007 seemed to me to be nothing but an extended exercise in excuse making. Visits to parents would always involve veiled references to ‘the property ladder’ and ‘career forwarding’ followed by much not so veiled hand wringing on my part about “the time not being right” and much “wait and see”-ing. I couldn’t even find refuge in my trusted friend television thanks to a rash of Allsops, Beanies and assorted ‘lifestyle’ types, all berating me to do exactly the opposite of what my gut wanted and clambering aboard their grubby bandwagon. In short, I don’t get on with unrestrained economic growth.

To be fair, I’m not alone in this department. Many of peers felt equally shafted by what was supposed to be our halcyon days and with good reason. We had grown up with nothing but Thatcherism and the associated messages that a) generating wealth is what you are here for and if you don’t, you are next to useless b) the state was not going to help you if you fucked things up and c) if you were from a single parent family then you were obviously a wrong ‘un (I had to stick that one in because it is something I will never be able to forgive the Tory’s for). Along with these more punitive points was the assumption that you could be whatever you wanted, just so long as you worked bloody hard and didn’t mind trampling on the toes of those less fortunate. When Labour got into power, the tone changed (much more “Chillax guys, we’re way more mellow and groovy than those Tory squares”) but the fundamental assumption was still basically the same: You can do/be anything your heart desires providing you put in the hours. A noble endeavour, surely? Well, on the face of it, maybe. In reality, not a cat in hells chance. Most of my friends (like myself) had done what we thought was expected of us. We went to 2nd tier uni’s, paid for the privilege and then fell into a labour market that was singularly unprepared for a glut of graduates with high expectations and identikit qualifications. Most of my friends ended up either in minimum wage retail jobs (counting on ill gotten bonuses to get them through), call centres, or in my case, the voluntary sector earning pennies. A few managed to carve a reasonable niche out in IT, but for most of us it a headlong rush into anything that would pay. For some it was even more of a painful experience as they had taken the ‘you can be anything you want ‘ message to heart. When it turned out that they couldn’t, they ended up blaming themselves and became trapped in a cycle of self loathing and nixed ambitions. Yet something else was also afoot. As the economy recovered from the dot-com bubble and then gradual morphed into a steroid-addled growth addict another message began to permeate the ether. The old convention that if you wanted something, you worked for it started to fade and in its place came the assumption that you could have what you wanted, no matter whether you could afford it now or not. Credit would provide you with the means to live beyond the physics of reality and as a society, we embraced it with wild abandon. We maxed out, balanced transferred and then maxed out again. Those who had a home pushed it even further and began to treat what should have been a dwelling as a veritable money making machine that had the ability to turn fuck all into a meal ticket. It was a one-way bet. Or so we thought. (I should point out at this point that I’m not entirely blind to the benefits of this period. At least we could get work, which is more than I can say for the poor bastards graduating right now).

As is my nature, I spent a fair few of these years chuntering and muttering about the unsustainability of it all, but I admit that towards 2006 a certain fatigue was setting in. Maybe the alchemists had turned based metal into gold and here was stupid old me, clinging on to a quaint set of values while the world laughed and took out another unsecured loan to pay for its next boob job. Luckily, I had company as 2007 saw the release of three very timely books: Larry Elliott and Dan Atkinson’s ‘Fantasy Island’, Oliver James’ ‘Affluenza’ and Naomi Klein’s ‘The Shock Doctrine’. While these three books all touched on different aspects of impending doom, they all bolstered my hunch that something had to give. I didn’t have to wait long as September ushered in the run on Northern Rock and the start of a golden period for good old misanthropic me: My Recession.

Part of me feels slightly ashamed to think back on the pleasure I derived from watching the queues outside the fast sinking Rock, but the other part of me was having a whale of a time. This was it! Finally, the fog that cloaked the mountain of bullshit we had accumulated was lifting and it was clear as day that all sorts of chickens were coming home to roost. The phony war endured for a few months with some writing the demise off the Rock as an anomaly, but to me this was stone cold proof that the system as we knew it had run out of road and we would be left with no option but to find a fairer way of running our lives. Further confirmation came in February ’08 when the government finally accepted what had been quite obvious for some time and took the Rock into national ownership. That was a particularly sweet moment for me, watching New Labour flail around wildly, desperately trying to escape the inevitable as their decade long game plan unraveled before the very eyes. It was like watching a man trying to eat his own face. For someone who had just spent three years working in the NHS and was appalled by the destructive and wrongheaded drive to impose free market anarchy on the most sacred and valued of our institutions, it felt as if some form of cosmic justice was beginning to impose itself.

But this was merely the beginning. As the months progressed the airwaves began to fill with competing versions of reality. Voices that had long been silenced as out of touch pessimists with an axe to grind start gaining traction (Will Hutton being a notable example) while the claims of vested interests became even more outlandish and disconnected. The evening news would parade the housing ‘industry experts’ who were still madly clinging to the idea that this was a flash in the pan and it would be business as usual just as soon this blip worked itself out. It didn’t and by March ’08 Bear Stearns joined the list of casualties. Yet still, this was not enough to slap some rationality into the situation and policy makers carried on parroting the ‘Keep calm and carry on’ message. It wasn’t until September and the seismic collapse of Lehman Bros that the people who mattered finally came to accept that this was it. This was the day that everything they knew turned out to be wrong. It was music to my ears.

Looking back now, it’s hard to appreciate just how monumental the implosion was that followed Lehman Bros demise. Post event mutterings mention phrases like ‘martial law’ being banded about in Washington’s corridors of power and even Alan Greenspan, godfather of this unholy mess and figurehead of the bogus boom economics was forced to concede that he had “found a flaw” in the system he helped create. Not to put too fine a point on it, what we accept as reality came within inches of disappearing in those weeks. And that’s when my problems started. You see, for me, this was the point when there was a window to actually do something creative with this mess, a chance to remodel the world to a new and more just blueprint. But we didn’t. There were certainly some prominent voices offering wise counsel at the time (St. Vince of Cable being one) but the big ideas were nowhere to be seen. As a default lefty, I was appalled. I understood that when things seem pretty good for everyone, it’s neigh on impossible to argue for anything different, but at that point in time, you’d have to be completely off your mash not to see that things were about as far from ‘good’ as is possible. There was no lack of discussion. I remember at the time that it seemed like The New Statesman had been invigorated with fresh purpose, but the resulting mélange of ideas lacked the clarity and structure to amount to more than rehashing of old touchstones and worn slogans. The left, presented with the opportunity of a lifetime, fumbled the ball and missed out on what should have been its finest hour. I realize that I’m just as much to blame as anyone else. I certainly didn’t have a solution and if you tried to pin me down to “what would you do then?” then I’d be hard pressed to present anything better than a return to the post-war settlement and a resurrection of Keynesian economics. That’s not enough to stop me being angry though.

After the big fireworks of the crash, the world has now found itself in weird, unsure place. All the main political parties had to offer was token support for “beefing up regulatory frameworks” and “getting tough on the bonus culture” (to which end they’ve done pretty much fuck all) whilst tacitly implying that what we really need is to wind the clock back to 2006. We didn’t even get our pound of flesh. For a brief period, it looked like the bankers, knocked from their pedestal would finally have to face a public they had so thoroughly screwed over. The mumbled ‘apologies’ at the select committee was as far as we got though as fortune favoured the crooked and gifted them with the MP’s expenses freakshow (possibly the most effective distraction I have ever witnessed in my life). As a result, we are still at the mercy of criminals whose self interest bought us all to the brink and a policy framework that amounts to stoking another bubble, just so we all feel better. I guess I shouldn’t be too pessimistic as it’s foolish for me to think that you can conceive a whole new way of conducting politics in just a few months, but right now, I’ve got to say that I don’t have much hope.

So where does this leave us all? Well, for one thing, it’s certainly made advertising all the more weird. Watching those NatWest ads where jobsworth staff of one of the biggest failed banks (now in public ownership) lecture customers about financial security made me wonder if I was experiencing an acid flashback and it’s even worse on the other side of the Atlantic. I went to New York in May and watched an advert where GM claimed to be “Redefining the Ownership Experience” just as it announced that it was closing the vast majority of its dealerships. Jesus wept. Mind you, if that’s 30 seconds of airtime that’s not being used to broadcast one of those fucking Confused.com atrocities, then I guess I can’t complain too much. On a more personal level, not much has changed. I work in mental health and right now, the misery business (in an underfunded/undervalued sort of way…naturally) is booming. However, we all know that as soon as the Tories get in we’re on the thinnest of ice and P45’s will follow in Cameron’s wake. I guess there have been a few positives as well. People seem less bothered about the stuff they ‘should’ own and at least we’ve got something to blame if we do fail. In that sense, the recession is like a nationwide sicknote (”Sorry I didn’t hand in my homework…the prevailing macro-economic weather ate it.”) and failure isn’t so painful when you’re not completely culpable. But the next few years are going to be hard. Very hard. Now that the clatter and din of impending doom has past, the banality of everyday woes is now the focal point. More people are going to lose their jobs, homes and self respect. As a nation, we will have to reassess our place in the world and will very likely have to eat some supersized helpings of humble pie in the near future. Part of me thinks “about time” and that maybe it will stop us tear-assing around the world stage, picking fights where we shouldn’t, but it also begs the question of who will fill the vacuum left by the west. To be honest, I’m not overly thrilled with the prospective candidates.

So there we have it, The Sorrowful Lament Of My Recession. I guess it serves me right for enjoying the woe of others so much, but I must say I’m bitterly disappointed. Still, at least The Property Ladder’s (of ‘Property Snakes and Ladders’ as it has been so aptly renamed) is a damn sight more interesting now.

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2 Responses to “The Sorrowful Lament of Loudribs Recession”

What I find interesting is the suggestion touted in the press that it will be a short recession and then we’ll be back to normal.

You touch upon the way people were quick to take on vast amounts of credit from the banking institutions which were happy to give it. Hence the credit ‘crunch’ when both the banks and the man on the street were suddenly denied additional credit.

Due to this ‘credit’ issue the government has had to step in as you say to shore up the banking system. The alternative is all the banks deciding to ‘call’ in what they’re owed by their creditors. Equally the goverment has put in place measures to help those in debt such as increased use of IVA’s and trying to avoid repossessions for mortgage arrears.

The outcome? The black hole is still there, the underlying ‘debt/credit’ issue hangs above (beneath?) the whole system. The only person who’s still got a decent credit score, the government has to borrow more to prop up the crazy pyramid scheme they’ve allowed to be created.

The long term prospects look bleak, it goes two ways. The government carrys on pushing money into this futile attempt to shore up the system which means less money for other public spending i.e. the NHS and welfare systems. Or it takes it’s finger out of the dam, and the flood gates open of the banks calling in their debts from the man in the street. Leading to greater pressure on welfare systems and the NHS. So face it either way when you need help from the system you think is there to help you (and which you pay a proportion of your income to to provide it) it most likely won’t be there.

The solution? Perhaps we need more cannibalisation and DIY…learn to take what others discard and use it for your own, thereby not spending/requiring as much money to live. You know those skills that your grandparents and parents had which we decided were of little use in our current society. At some point we were told (duped!) and believed that it clearly makes more sense to invest our precious time in the factory/office (which naturally makes more money for the master than the slave) rather than in the shed/garage/garden!

Too true….the really interesting situation to watch is unemployment. One of the things that has given this event it’s weird tint is that for the bulk of it, most of the action has been confined to the world of finance. The real world has been left in the somewhat disconcerting position of having the news scream “OMG! SKY IZ FALLING! WIMIN AND CHILDRENZ FURST!” yet not seeing a great deal of evidence in everyday life (except for the bizarrely British drama that was the demise of Woolworths, may god rest its soul). Measures of the stuff that actually affects people always lags behind the far snappier world of global finance (speaking of which, there’s a great article on just how damn snappy things are getting… http://arstechnica.com/tech-policy/news/2009/07/-it-sounds-like-something.ars) and that makes for the utterly bonkers scene we are about to witness. Sooner or later, The City is going to get all giddy as someone declares that it’s all over, just as the nation as a whole gets properly stuck into the business of getting fucked by Das Krunch. Can’t wait for that one.

Anyhoo, umemployment. It’s especially important in the UK because of how weirdly contorted our economy is. Basically, the high levels of (badly paid) employment in the boom underwrote the explosion of credit. Providing people could carry on paying back their debts (at least at token level), the merry-go-round could keep spinning and the housing market would keep inflating….a supposedly virtuous cirle. Because the merry-go-round kept spinning for neigh on 10 years, it accumulated an absolutely staggering level of consumer debt (£1.5 trillion) and as you say, The City wants it back now. When people lose their jobs, they can’t pay (not mention lost tax revenue and increased public spending). That wasn’t a problem during the boom years as pretty much anyone could acquire further debts to pay off their existing ones, but now the banks are too twitchy to lend and the circle is broken. Unemployment is basically a massive timebomb that will eventually feed back into the world of finance, further destabalise the housing market and have the biggest impact on public services. And that will be a massive shock to our generation who only remember recession as something that happened to their folks.

The solution? GET KEYNESIAN ON THAT MOTHERFUCKER! But that’s my answer for everything.